The strategic benefits of integrated HR systems

HR experts explain how integrating business applications can improve data security and accuracy, and enable teams to work more intelligently

Although HR systems integration has been a concern for enterprise-sized companies for many years, more and more HR professionals in organisations of all sizes and shapes are waking up to the potential benefits.

“Technology is in a good place now, and people are recognising that,” says Jon Morgan, an HRIS specialist who has worked at firms such as the British Standards Institute (BSI) and BP. “It’s become a lot more intuitive, and people are realising that double-keying data – either from an administration point of view or an end-user point of view – is pointless and frustrating, and can be minimised.” This realisation chimes with the findings of our research, in which 36% of senior UK HR decision-makers said they would expect systems integration to reduce the time their teams spend on administration.

“HR professionals are definitely starting to get to grips with more complicated systems arrangements and to question their people technology a bit more,” says Kate Wadia, managing director at Phase 3 Consulting. “We used to say to clients that integration was a good thing, but hard to achieve. Now we are able to talk about it in more nuanced terms; that integrating perhaps 90% of your systems is a good, realistic aim.”

She adds: “As we use technology more and more in our daily lives outside work, it’s becoming less intimidating to approach these kinds of questions in the workplace.” This sentiment chimes with the responses of the 500 senior HR professionals we surveyed, 51% of which agreed with the statement that there was ‘no single piece of HR software that will be able to satisfy all of the HR requirements for my business’. Just 12% of respondents disagreed.

“People are realising that double-keying data is pointless and frustrating, and can be minimised”

A further third of HR professionals we surveyed said they spend up to 10 hours a month updating and transferring data between HR systems – which is hardly surprising given the recent proliferation of HR technologies. Whether your specialism is reward, communication, diversity, learning or something else entirely, it seems there’s an app for that – and HR professionals have been eager to give the latest digital solutions a go.

“Technology has come along, we’ve grabbed it, and now suddenly we have all these systems and we’re not really sure how to integrate them and use them together,” says Kathryn Kendall, chief people officer at HR platform provider Benefex. “Historically, HR’s approach to technology has been very reactive; if there’s a problem, we’ll find some kit to solve it. Thought hasn’t been given to how that new kit fits alongside the overall HR strategy, and often it’s been brought in in the context of functional silos.”

But those attitudes are starting to change, says David Wilson, CEO at Fosway Group, an HR and L&D analyst firm. “There is a lot more focus now on connecting the dots between component systems, and on the impact of [HR technology] on people in the workforce. “This is pushing a lot more organisations, as part of their whole IT strategy, to look either for better-integrated components, or to simplify that landscape and move to a smaller number of core systems.”

“The more non-HR data you can merge with your HR data, the better you are able to articulate the impact of HR initiatives on business measures such as productivity or sales”

One key reason why integrated systems are a “necessity”, says Jordan Mori, managing partner at Hensen Associates, is so that HR teams – and organisation’s leaders and line managers – have a comprehensive view of employee data and metrics. “You want to be in a place where you have one single view of an employee, with solid data sitting underneath.”

“The more non-HR data you can merge with your HR data, the better you are able to articulate the impact of HR initiatives on business measures such as productivity or sales,” says Nigel Dias, managing director of 3n Strategy, an HR analytics firm. Having consistent data is essential if you want to use it to make evidence-based decisions, he adds. “If your systems and data are integrated, then it means you are always comparing apples with apples – not apples with oranges. If everything is in one system, it’s easier to paint a picture of how the whole organisation is functioning, and to make strategic decisions.”

It’s not possible to effectively analyse an organisation’s current skillset and capabilities, and its future development needs and performance, via a standalone HR system, says Wilson. “[Integrated data] enables you to take a much more strategic view of what the workforce is, and how it is engaged with the work that you do. Ultimately, that can help you drive change strategies that enable you to enhance organisational performance. That’s really the big value of integrated HR technology. But many organisations struggle to realise this opportunity because they are busy tackling the transactional challenges.”

Employee preferences shouldn’t be overlooked when considering the complex web of HR technologies that most organisations grapple with. In a world where a Google account will grant you access to a host of services – both those provided by Google and by other companies – staff are no longer willing to put up with disjointed systems at work. And why should they?

“Data enables you to take a much more strategic view of how your workforce is engaged with what you do. That’s the big value of integrated HR technology”

“One of our clients, a large professional membership body, surveyed its employees about what they wanted from their HR systems. And one of the top three things was not to have to remember lots of different usernames and passwords,” says Megan Hope, partner manager at CIPHR. “The organisation has decided it is happy to use multiple systems to deliver HR-related services, but they will only procure software from vendors who can facilitate a single sign-on with the core people management system. I’m expecting this to be the case for a growing proportion of employers.”

Those without connected systems will be presenting workers with a “confusing jigsaw of [an] employee experience,” says David Heard, director at Abintegro, a career development platform. “The employee doesn’t know where to go, they don’t remember the access routes or passwords to get into different systems – it’s a really poor experience.”

And while that’s annoying enough for employees who are struggling to access the tools and training they need, it can create frustration for HR teams, too, Heard adds. “Poor experience leads to low engagement with technology, and low utilisation rates, with HR teams getting frustrated they’ve put a lot of energy and money into making things work. But the project is doomed from the start, because the disparate systems aren’t connected.”

This consumerisation of technology will be key to how HR approaches technology purchasing and implementation decisions in the future, and its consideration of how technology can impact organisations’ ability to attract, recruit and retain top-calibre applicants. “To date, [HR] systems have been very transactional, and HR hasn’t thought about the employee experience,” says Kendall. “If you look at the traditional experience of a new starter coming into an organisation, from a technology perspective it’s still generally really poor, because you’ve got systems all over the place and they aren’t joined up. There’s a huge opportunity for improvement.”

This is an extra from CIPHR’s free white paper, Better together: the future for HR systems integration. Download it here